Multilateral Development Banks’ Paris Alignment Methodologies

The Multilateral Development Banks (MDBs) play a substantial role in the global transition to low-carbon, climate-resilient economies and societies. In 2017, they collectively committed to supporting countries’ implementation of the Paris Climate Agreement goals. In the context of this commitment, in June 2023, the MDBs published the Joint MDB Methodological Principles for Assessment of Paris Agreement Alignment. These principles set out a common basis for defining and assessing new MDB operations’ Paris alignment. Additionally, four MDBs – the European Bank for Reconstruction and Development (EBRD), Inter-American Development Bank (IDB), World Bank, and Asian Infrastructure and Investment Bank (AIIB) – published individual versions of the joint principles. 

MDBs should pursue the highest standards in their Paris-alignment approaches, as they channel an annual average of over USD 100 billion in development finance to partner countries and play a pioneering role in the financial sector. Other financial institutions, companies, and governments also often follow the MDBs in setting standards. 

This paper examines how the MDBs aim to put Paris alignment into practice. The analysis highlights both shortcomings and best practice in the joint MDB methodological principles, and the specific Paris-alignment methodologies of the World Bank, EBRD, IDB, and AIIB. It does this with a particular view to providing constructive input for upcoming reviews and revisions of those methodologies. 

Recording of our webinar "Deep dive on MDB Paris alignment methodologies: